Abstract
Sabra Health Care will report its fourth-quarter results on February 12, 2026 Post Market, with investors watching revenue, margins, and adjusted EPS to gauge progress on operating recovery and portfolio optimization.Market Forecast
Consensus for the current quarter indicates revenue of $0.18 billion, EBIT of $82.30 million, and EPS of $0.17, implying a revenue year-over-year increase of 3.81% and EBIT growth of 22.49%, while the EPS forecast suggests a 5.84% year-over-year gain. Margin-level expectations are not clearly quantified by the market, but the company’s mix and recent run-rate suggest a stable-to-improving gross margin profile; the net margin will hinge on operating leverage and interest costs. The company’s main business is expected to remain anchored by resident fees and services alongside rental and related income, with stabilization in occupancy and rate supporting a steady outlook. The most promising segment appears to be resident fees and services at $92.02 million last quarter, where incremental occupancy and rate improvement offer the greatest sensitivity to top-line and margin expansion on a year-over-year basis.Last Quarter Review
Sabra Health Care’s last reported quarter delivered revenue of $0.19 billion, gross profit margin of 63.71%, GAAP net profit attributable to the parent company of $22.54 million, a net profit margin of 11.78%, and adjusted EPS of $0.09, with year-over-year trends showing mixed performance and a quarter-on-quarter net income contraction of 65.61%. The quarter’s key highlight was a continued gross margin of 63.71%, reflecting disciplined cost structure and a favorable revenue mix despite variability in earnings. Main business composition showed resident fees and services at $92.02 million, rental and related income at $85.35 million, and interest and other at $12.67 million, with resident services showing the greatest potential for sequential leverage as occupancy trends improve.Current Quarter Outlook (with major analytical insights)
Main business trajectory and revenue quality
The company’s two primary revenue channels—resident fees and services, and rental and related income—continue to provide a diversified top line. With estimated revenue of $0.18 billion this quarter and an implied 3.81% year-over-year increase, the mix suggests that operating communities are holding pricing while occupancy normalizes toward pre-pandemic baselines. Gross margin resilience at 63.71% last quarter sets a constructive reference point; if community-level operating efficiencies and portfolio pruning continue, the current quarter could see modest expansion, though rising labor costs in care settings remain a swing factor. Rental and related income tends to be steadier, cushioning variability from operating assets; however, lease restructurings and operator health can still influence rent coverage and collection timing, factors that investors will monitor closely in the print.The quality of revenue this quarter will depend on the balance between occupancy gains and the cost of staffing to maintain service levels. A stable rent collection backdrop, aided by improved tenant coverage ratios, would support predictability in cash flows and EBIT. Meanwhile, operating assets generating resident fees are leveraged to rate increases, acuity mix, and staffing efficiency; incremental gains here can augment gross profit dollars, which in turn should translate into higher operating margin if corporate overhead remains controlled. On the expense line, interest costs remain a consideration; any reduction in leverage or refinancing activity can enhance net margin, while variability in non-cash items may introduce GAAP-to-non-GAAP differences.
Most promising growth pocket and operating leverage
Resident fees and services, last quarter at $92.02 million, remain the clearest lever for organic top-line growth. This revenue line is sensitive to improvements in occupancy and daily rates; even small percentage gains can produce outsized impact on EBIT given relatively high fixed-cost absorption at the community level. The forecasted EBIT of $82.30 million implies healthy operating leverage if revenue lands around consensus, suggesting that incremental margin capture is feasible in an environment of stable demand and improving operating performance from key communities. If management continues to optimize its operating portfolio—either through targeted investments in higher-acuity settings, or via partnerships that drive throughput and case mix—this segment could provide a noticeable contribution to both gross profit dollars and adjusted EPS.The rate environment also interacts with this segment’s economics. If the labor market remains manageable, wage inflation may be contained enough to allow rate increases to flow through. Conversely, a rise in agency staffing utilization could compress gross margins, even if revenue grows. Investors should also monitor length-of-stay and payor mix; higher acuity or private-pay weights can lift revenue per occupied unit and improve profitability, whereas pressure on reimbursement rates would dampen upside. A constructive scenario for the quarter would include a modest uptick in occupancy, limited reliance on premium labor, and steady rent collections from operating partners.
Key stock-price drivers this quarter
The most material driver is the spread between revenue growth and operating expense growth, which determines whether EBIT expands in line with the 22.49% year-over-year forecast. Should resident fees and services outpace cost increases, the company can deliver operating leverage that supports both EBIT and adjusted EPS. A second driver is net interest cost; with a relatively sensitive balance sheet, even small changes in interest expense can move net margin and GAAP earnings, especially given last quarter’s 11.78% net profit margin baseline. The third driver is the performance of tenants underlying the rental income stream: higher rent coverage and improved collections directly support consistent cash generation and de-risk guidance.Investor sentiment will also respond to any updates on portfolio optimization and capital allocation, including dispositions, redevelopments, or strategic investments. Evidence of sustained rent coverage improvement and stable occupancy trajectories across key operating partners could reinforce confidence in the revenue trajectory and margin stability. Conversely, any signs of operator stress or unexpected expense spikes would likely weigh on confidence in achieving the forecasted EPS of $0.17.
Analyst Opinions
Recent commentary skews more constructive than cautious, with a majority of institutional voices emphasizing stabilization in operating metrics and potential for moderate growth in adjusted EPS. Analysts focusing on healthcare real estate fundamentals highlight balanced exposure between rental cash flows and operating revenue, which underpins a more dependable earnings profile in the near term. The consensus tilt toward a positive stance rests on evidence of improved rent coverage among tenants and incremental occupancy gains, as well as company-level discipline in managing operating costs and capital structure.A notable view points to the company’s ability to translate modest top-line growth into EBIT expansion, aligning with the 22.49% year-over-year EBIT estimate. The bullish case anticipates a continuation of steady rent receipts and measured improvement from operating communities, allowing for a gradual lift in margins and supporting the projected EPS of $0.17. These perspectives generally argue that the risk-reward skews favorable into the print provided management reiterates or raises its near-term outlook and provides clarity on cost containment and portfolio activity. On balance, the preponderance of opinion remains positive, with bulls expecting Sabra Health Care to meet or slightly exceed consensus on revenue and EBIT while guiding to ongoing stabilization across its core operating and rental portfolios.
Comments